The Senate Standing Committee on Finance and Revenue Monday unanimously opposed the proposal to increase the sales tax on branded clothes and other branded items.

The meeting of the committee was held with Senator Saleem Mandviwalla in the chair. The representatives of the Federal Board of Revenue (FBR) told the committee that sales tax has been increased to 18 percent on bulk purchases of branded food items.

The food items being sold under any branded name will be slapped with an 18 percent general sales tax.

The FBR officials said that the purpose of slapping the tax is to tax the rich and those buying branded items in bulk. However, the committee expressed reservations about the imposition of general sales tax on branded food items.

The committee also discussed the matter of an increase in tax on branded clothes. Senator Saadia Abbasi opposed the increase in tax on branded clothes and said that no other country charges such a high tax.

Minister of State for Finance Dr. Aisha Ghaus Pasha highlighted that Canada charges 18 percent sales tax. Senator Abbasi said that such a high tax would be justifiable if Pakistan’s economy was as good as that of Canada.

The minister quipped that people should buy local clothes instead of branded clothes and that government is trying to raise tax revenue through such measures. However, the committee unanimously rejected the proposal to increase the sales tax from 12 percent to 15 percent on branded clothes.

Source: Pro Pakistani